The Research On Performance Measurement And Manager Incentive In List Corporations

After the promulgation of the Public Company Governance Principle, almost eighty percent of the companies have accordingly established executive compensation plan and assessment committee as well as the performance measurement system. As a result, these measures would have positive influence on mobilizing the managers' enthusiasm and creativity, which would advance corporate benefit and perfect modern enterprise system. However, the theory of performance measurement and management incentive is absent and as well the criterion in just impartiality and publicity incentive policy. The incentive issues emerge as time goes by. There are three aspects we should draw our attention to. Firstly, incentive ideas are entirely western which are very difficult to harmonization with politics, economy and culture in China. Secondly, there are manly incentive means but have not a reasonable structure. Thirdly, incentive levels have wide gap that is not accordingly with performance. These problems have caused serious consequence that corporate can't form correct axiology and advanced culture. Even in some cases, the managers' activities are far from incentive objectives that cause the losing of the clients and the social benefits. Therefore the conclusion can be drawn, it is compulsory that the research on the establishing of incentive and performance measurement system must be done in order to perfect corporate governance structure, protect consigners' rights and interests and advance the development of the security market.The theories in western have formed a system which includes administer incentive theory and economics incentive theory. Administer incentive theory deepens the understanding of incentive rule by aiming at human nature, which has developed different theories such as the Maslow demanding level theory, Vroom expectation theory, Robert House colligate incentive pattern theory and Adams equity theory. Those theories have done important contribution to post the important function and common rule. Economic incentive theory emphasizes the research concerning the relationship and deepens the recognize of system establishment step by step and have developed different theories such as bargaining expense theory, principal agent theory, contract theory, enterpriser theory and human capital theory which have established characteristic system info. Those theories afford stable bases for incentive problems and system plans which will have significant direction in the research of manager incentive and the design of corporate governance system. Moreover, they have theirlimitations. At first, these theory systems are always imperfection contracts, so they can only infinitely approach but can't reach the self-contained limit. At second, these theories are based on western politics, economy system and culture foundation, which don't tally with Chinese practices. So there are still many problems to study with regard to the incentive theory, for example the logic precondition, managers' humanity attribute and incentive methods, incentive utility and measurement, performance measurement and incentive mechanism. This paper analyzes these matters oriented with practices.The research on the incentive effects in list corporations has its inevitability logically. On the one hand, as the main organization form, the separation of shareholders and mangers leads to the enterpriser function decomposing, the differentiation between shareholders' and managers' benefit, and the non-symmetry information that all lead to establishment of contract relationship between owners and mangers. But any contracts are imperfect which leads to residual in enterprises. Under the circumstances, the essential means is to endow the managers with risk compensation and encourage the mangers shoulder risk in order to make the managers bear the residual risk and create maximal residual income. In accordance, the manger incentive problem is logically necessary.On the other hand, the human capital is one of the capital forms. The managers have the nature for...